What are Blockchain Games?

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In the broadest sense blockchain games are games that utilize blockchain technology. With this blockchain technology gamers are being empowered. It allows them to have full ownership over digital assets, and in some cases gamers even govern the entire game. There are many degrees of blockchain games, but before we dive into those it’s important to understand blockchain technology itself.

Introduction into blockchain

A blockchain is a type of computer network that decentralizes control over that network. This means that power of the data is not in the hands of one organization, like Google or Amazon. Instead many computers all over the world contribute to that network, and these computers (called nodes or miners) earn rewards for their contributions. This means that one person can’t just turn off the network.

In a normal network a file can move from one computer to the other without anybody noticing. On the blockchain every move of data is verified by the entire network. That’s the reason why something like bitcoin works. Across the network all computers approve, confirm and register every transaction. Therefore nobody can spend money that’s not theirs. The blockchain is the road that allows Bitcoin to drive around the world and have an impact. For a more technological and in-depth look at Bitcoin and blockchain, I will refer you to YouTube channel of Andreas Antonopoulos.

However, Bitcoin isn’t the only product using blockchain technology. Other projects also use the principles of this technology. For the sake of crypto art and blockchain gaming, Ethereum is the most prominent one. In addition we talk a lot about Flow, Wax, EOS, and Tron in our article on Play to Earn. In addition there are companies that use private blockchains, for example to track products in their distribution line. Each of these blockchain projects are being organized in a different way, but the essence is the same: Governance over the entire network is decentralized through a certain protocol, and data transfers and ownership are verified by each node in the network. Whether these nodes are public (Ethereum and Bitcoin) or private (IBM Hyperledger) doesn’t matter.

Games on the blockchain

When we talk about blockchain games, we mean games that utilize blockchain technology for one or more aspects of their game experience. There are games that only store ownership over in-game assets on the blockchain, and there are games that run their entire world on the blockchain. Between these two extremes there are different degrees.

Minimal – Ownership over game assets

The game is running on a centralized server like any other game on the market. However, players can buy in-game cosmetics that are tied to a blockchain token. This would be a non-fungible token or NFT. This means that only the owner of that particular token has access to the digital asset it is associated with. As a result it’s possible to be the only owner of a digital sword inside a role playing game. The blockchain registers every transaction and token ownership, and everybody can see that you are the one person owning that particular token. Based on the popularity of the game and the usability inside the game, that particular token has a certain real-world financial value. (Example: Skins in Light Trail Rush)

Medium – Ownership & economy contribution

In addition to purchasable NFTs, there’s also the possibility that users generate assets on the blockchain. For example, it’s entirely possible for a game to randomly generate an unique sword, and players can pick it up. After picking it up, the item is stored in the user’s cryptocurrency wallet that’s tied to the game. In addition users could be gathering resources, basically gift wrap them in-game, and sell the package to other players through an open marketplace running on blockchain technology. Even though these type of games are still running on a centralized server, they use blockchain technology for ownership of digital assets, trading assets and randomly generated an unique item. (Example: Games that embrace play-to-earn)

Maximal – Complete decentralized governance

The ultimate blockchain game uses everything described above, but in addition has its entire gameplay build on the blockchain. Every node verifies every choice someone makes. As a result cheating is virtually impossible. However, this also means that the game developer is losing some of the control they normally have. There have been games running on existing blockchains, and there are games that are using their own custom blockchain that’s completely maintained by the players themselves. It’s basically the ultimate form if self-governance. (Example: Nine Chronicles and Taurion)

Robert Hoogendoorn avatar
Robert Hoogendoorn is a gamer and blockchain enthusiast. He got in touch with crypto in 2014, but the fire really lit in 2017. Professionally he's a content optimization expert and worked for press agencies and video production companies, always with a focus on the video games & tech industry. He's a content manager and creator at heart, started the Play to Earn Online Magazine in early 2020.